Working Paper: CEPR ID: DP5494
Authors: Dirk Bergemann; Juuso Valimaki
Abstract: We survey the recent literature on the role of information in mechanism design. First, we discuss an emerging literature on the role of endogenous payoff and strategic information for the design and the efficiency of the mechanism. We specifically consider information management in the form of acquisition of new information or disclosure of existing information. Second, we argue that in the presence of endogenous information, the robustness of the mechanism to the type space and higher order beliefs becomes a natural desideratum. We discuss recent approaches to robust mechanism design and robust implementation.
Keywords: acquisition; design; information; mechanism; robust
JEL Codes: D82; D83
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| structure of information available to agents (D82) | willingness to invest in acquiring information (D83) |
| willingness to invest in acquiring information (D83) | efficiency of the mechanism (D61) |
| type of mechanism (L64) | information acquisition (D83) |
| information disclosure by the auctioneer (D44) | changes in bidders' behavior (D44) |
| changes in bidders' behavior (D44) | auction outcomes (D44) |
| robust mechanism design (D47) | improved performance in uncertain environments (D80) |